December 12, 2018

Fiesta Bowl

Anti-BCS Group Sics IRS on Bowl Games Over Tax-Exempt Status

If you’re a college football fan, the debate over the Bowl Championship Series is something that has been rehashed every year since it came into existence. As we see it, there are three camps to this situation:

1) Those that hate the BCS with every fiber of their being and would sacrifice a family member (not always a hard choice, we realize) to have a playoff system.

2) Those that are fairly indifferent, which includes significant others that only pay attention because their gridiron-crazed other half can’t stop talking about it – “Nothing you can do about it, so just leave it alone.”

3) Those that support the BCS system because it makes them filthy rich.

But who knew that there was political action committee whose sole purpose for existing was bringing this controversial enigma to its knees? As you might expect, their pursuit has been all for naught but now they are feeling more confident because they are pursuing the BCS in a way that has proven historically successful: tax-related charges:

Playoff PAC, a political action committee that wants the bowls replaced with a championship playoff system, plans to file a complaint with the Internal Revenue Service on Thursday against the operators of the Fiesta, Sugar and Orange Bowls, three of the five games that constitute the Bowl Championship Series (the others are the Rose Bowl and the BCS title game). The Associated Press obtained a copy of the complaint prior to its filing.

A team of six lawyers and one accountant, working for no compensation, reviewed 2,300 pages of tax returns and public documents associated with all four bowls, said Playoff PAC co-founder Matthew Sanderson. The Pasadena, Calif.-based Rose Bowl was found to be “fairly free of these irregularities,” Sanderson said.

Think about it. A seemingly invincible opponent – Al Capone, UBS, you get the pic – has to have a chink in its armor somewhere. With this in mind, the Playoff PAC figured that finding a violation of the mind-numbing U.S. tax law was the best way to slay the BCS beast.

Playoff PAC is citing ‘extravagant’ salaries for the Sugar and Fiesta Bowl CEOs ($645k and $600k respectively) compared to the salaries of the Rose and Orange Bowls ($280k and $360k) as well as zero-interest loans that were provided to Fiesta Bowl executives. Playoff PAC is also poking around perks – the usual: golf, entertainment – provided to Bowl execs and possible extensive lobbying by the Fiesta Bowl and contributions to J.D. Hayworth, who ran and lost against Senator John McCain in the GOP primary.

Naturally, the Bowl people say this is all old worn-out nonsense from a bunch of haters. They comply with all laws, yada, yada, yada.

The problem, as the AP article points out, is that even if the Bowls are throwing around their donations all willy nilly, that doesn’t mean the IRS will revoke their tax-exempt status nor is it likely to get the playoff system in place that virtually everyone wants.

Using the tax law to break the iron grip that the BCS overlords have on the sport may be the right approach but Playoff PAC is going to need a much more convincing case then some exorbitant salaries, a few rounds of golf and big catering spreads. “IT’S DIVISION ONE FOOTBALL!” after all; it’s not for amateurs (except for the players, of course).

AP Exclusive: Tax status of bowl games challenged [AP]